Japanese equities closed lower on Monday, in line with its Asian peers, amid mounting pressure from rising oil prices as the negotiations in the Iran conflict stall.
The Nikkei 225 closed down 593.34 points, or 1.0%, at 60,815.95.
Fresh drone attacks in the Gulf regions pushed oil prices and bond yields higher on Monday, according to a Reuters report.
Brent crude rose to over $111 per barrel, as the talks for the restoration of the passage through the strategic Strait of Hormuz remain unresolved.
Investor sentiment was further dampened by U.S. President Donald Trump, warning that the "clock is ticking" before the U.S. launches harder strikes.
A report by Nikkei Asia also indicated that yields on 10-year Japanese government bonds hit their highest in 29 years at 2.8% on Monday, amid investor concerns over inflation and the fiscal situation.
On the corporate side, shares of Japan Post Insurance's (TYO:7181) slumped over 11% on Monday, even as its net income attributable jumped 37% to 168.80 billion yen for the fiscal year 2025 from 123.47 billion yen a year earlier.